This is good news!
Treasury Secretary Henry Paulson said Wednesday that original plan to purchase distressed mortgage assets from Wall Street firms is not the best use of the $700 billion financial rescue package, and officials will now focus on direct capital injections into the struggling financial firms.
Also, I had not thought of the all of the direct action in the commercial paper markets and that USGOV action has worked out to.
Buying up MBSs was always a lousy idea because “between the bad and fraudulent loan data and the flawed risk models, currently, complex mortgage securities can not be valued with any reasonable accuracy” thus the US Taxpayers were going to get screwed.
Update: HotAir covers the issue a bit differently but evenhandedly.